Section 167. Civil liability for misstatement in prospectus

(1) A person who subscribes for or purchases any shares or debentures and suffers loss or damage as a result of any statement or information contained in a prospectus that is false or misleading or any statement or information contained in a prospectus from which there is a material omission, may recover the amount of loss or damage from the following persons:

(a) the corporation and each director of the corporation at the time of the issue of the prospectus;

(b) a person who consented or caused himself to be named and is named in the prospectus as a director or as having agreed to become a director, either immediately or after an interval of time;

(c) a promoter, for any loss or damage arising from the prospectus or any relevant portion of the prospectus in respect of which he is a party to the preparation of the prospectus;

(d) a person named in the prospectus with his consent as having made a statement that is included in the prospectus or on which a statement made in the prospectus is based, for any loss or damage caused by the inclusion of the statement in the prospectus; or

(e) a person who authorized or caused the issue of a prospectus in contravention of section 168, for any loss or damage caused by such contravention.

(2) No person shall be liable under subsection (1) if he proves that—

(a) having consented to become a director of the corporation, he withdrew his consent before the issue of the prospectus and that the prospectus was issued without his authority or consent;

(b) the prospectus was issued without his knowledge or consent and he gave reasonable notice to the public after he becomes aware of its issue;

(c) after the issue of the prospectus and before the allotment or sale of the shares or debentures, he has withdrawn his consent after he becomes aware of any false or misleading statement in the prospectus and gives reasonable notice to the public of the withdrawal together with the reason; or

(d) in relation to every false or misleading statement—

(i) he has reasonable ground to believe that the statement is true up to the time of the allotment or sale of the shares or debentures;

(ii) purporting to be a statement, or based on a statement, or contained in what purports to be a copy of or extract from a report of valuation of an expert, and that he has reasonable ground to believe that the person making the statement is an expert and competent to make the true statement up to the time of the issue of the prospectus and that person has given the consent required under section 160 to the issue of the prospectus and has not withdrawn that consent before delivery of a copy of the prospectus for registration or before any allotment or sale of the shares or debentures; and

(iii) purporting to be a statement made by an official person or contained in what purports to be a copy of or extract from a public official document, the statement is a true and fair representation of the statement or copy of or extract from the document.

(3) Subsection (2) shall not apply in the case of a person liable, by reason of his having given a consent required of him by section 160, as a person who has authorized or caused the issue of the prospectus in respect of a false and misleading statement purporting to have been made by him as an expert.

(4) A person who, apart from this subsection would under subsection (1) be liable, by reason of his having given a consent required by him by section 160 as a person who has authorized the issue of a prospectus in respect of a false or misleading statement purporting to be made by him as an expert shall not be liable if he proves that—

(a) he withdrew his consent in writing before a copy of the prospectus was lodged with the Registrar;

(b) after a copy of the prospectus was lodged with the Registrar and before allotment or sale of the shares or debentures, he withdrew his consent in writing after he becomes aware of the false or misleading statement and gives reasonable notice to the public of the withdrawal together with the reason; or

(c) he is competent to make the statement and that he has reasonable ground to believe that the statement is true up to the time of the allotment or sale of the shares or debentures.

(5) Where—

(a) the prospectus contains the name of a person as a director of the corporation, or a person who has agreed but has not consented to become a director or has withdrawn his consent before the issue of the prospectus and has not authorized or consented to the issue of the prospectus; or

(b) the consent of a person is required under section 160 to the issue of the prospectus and he either has not given the consent or has withdrawn the consent before the issue of the prospectus,

the directors of the corporation except those without their knowledge or consent the prospectus is issued, and any other person who authorized or caused the issuance of the prospectus shall be liable to indemnify the person so named or whose consent is required against all damages, costs and expenses to which he may be made liable by reason of his name having been inserted in the prospectus or of the inclusion in the prospectus of a statement purporting to be made by him, or in defending himself against any action or legal proceeding brought against him in respect of the prospectus.